The storage capacities of iPhones aren’t a side effect, they are a choice. I cannot begin to imagine the amount of discussion, research and thought that Apple has put into the capacities of their headline product. I’m sure bumping up the base model to 32GB would cost the company more and so by holding the line at 16GB for another year they will increase their profits. This near term benefit will surely help their balance sheet in their next earnings call but comes at the cost of the day-to-day experience of some of their customers.

In the end Apple has decided to continue offering a product that will almost inevitably fail their customer at some point, and potentially fail them at a moment of deep personal importance.

There were very few disappointments in yesterday’s event, but the continued existence of a 16 GB base model iPhone is definitely one.1

I’ve always assumed that the 16 GB model exists as the shit model that you don’t buy, but which makes spending another $100 for four times the space significantly more palatable. But that theory doesn’t entirely make sense. The data that Smith has shows that 43% of his iPhone 6 customers went ahead and bought 16 GB iPhones anyway.

Putting another 16 GB of storage space in the base model would undoubtably cost Apple a couple of dollars per phone2 and, at tens of millions of phones per quarter, cost them a not-inconsiderable amount in profit over the lifetime of the product, but the 16 GB iPhone is untenable in 2015. Sure, put that much storage in the free-on-contract model (this year, the 5S) but the most recent model is supposed to be the flagship, even in its base configuration.

Component pricing is a closely-guarded secret, and nobody outside of Apple knows how much they pay for their flash storage. I feel that this is a reasonable estimate based on current market trends and profit margins. ↩︎